Your Personal Trader - DJIM Journal 2011

It didn’t take long for answers to the negative assertions presented in yesterday’s Journal, including somewhat rhetorical questions…”Stubborn/resilient or (dumb)? ..”How long can this (oblivious) last?....Are stronger (Ahead of) than expected earnings Q4 prints going to be enough to hold up the market?.

A fall of 20ES points from premarket, ~13 SPX /40 Naz day points and notably a ‘cloudy’ after hours session may finally awaken the shorts to participate in this market. All in, wish the DOW was off 300 points instead of 12 as it gives a false impression of the underlying tape. Most of the profit taking now is earnings related, but the ‘wary’ stuff noted here, (policy tightening speculation globally) aspects of the market (inc. 2H January effect) are working themselves into the markets ‘psyche’. Today was the first day in weeks we’ve seen profit taking pick up as investors have been willing to hold on, but days like today will wake up the complacent ones and may cause more selling down the road along with more confident ‘shorts’ coming back. So, the strategy of hoarding cash for potential earnings plays remains to avoid any of this today and potentially more. This also works because after today’s action in financials, tech, ’10 winners, ag’s, we’re left with little leadership to seek for a trade. Allowing the overbought conditions to work themselves out will be in the best interest of all 2011 Bulls. It’s been a good 6 weeks without coming close to the 20ma, the market can use a visit. Recall a trading premise here, if intraday dip buyers do not appear as was the case today, they usually don’t come in the next day.

Technical- Support 1277' ish on a close basis, followed by 20ma pretty easily, if busted.

Shadowlist

Momentum/earnings/“winners of ‘10 – discussion here of the overhang of Jobs outweighing AAPL’s excellent print played out as the stock rolled softly downwards all day from ~450’ish post earnings levels signified no follow through for itself and importantly for those hoping AAPL/IBM could pull the market higher and unfortunately answered ….”Are stronger (Ahead of) than expected earnings Q4 prints going to be enough to hold up the market?. “…But, this was hardly the reason for a 40pt fall, the real reason was..” the component stocks like CREE LLTC had disappointing inventory correction themes”. You can add WDC to the ‘inventory’ trend (which hurts PC outlooks) and more reports tonight confirm this negative. The ‘unfortunately’ lack of participation from the FFIV CRM RVBD types hovering at 9ema support yesterday had most breaking this support intraday only to avalanche big time post FFIV earnings AMC. As we know from early October post EQIX preannouncement, the whole family gets taken out to the woodshed and that’s definitely the case AMC w/ FFIV off ~30+, APKT off 7, RVBD ~6, EQIX ~5, CRM ~10 etc.

Interestingly, go back to CSCO’s report and see what we said may eventually show up and be a negative come January reports!

Commodities- the Ag’ play introduced here in December for early ’11 finally curtailed as investors used the Cargil ‘divest’ of MOS shares as an ‘excuse’ to take profits. An’ excuse ‘ is what is, but that’s all a market needs to take profits and ask questions later. Tightening spec. globally leaves little to trade now in commodity linked stocks.

Financials- ..”A ton of names to report on Wed. (inc GS WFC) to potentially (hope) negate C’s print.” . The ‘hope’ didn’t materialize one bit as GS and many others in space disappointed with earnings and as in recent Q’s the sector runs into earnings and falters(selling) soon after.